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Will Maine open the floodgates to lower-cost medicines and cause drugmakers unending grief? After months of debate, state residents can now buy prescription drugs from mail-order pharmacies in a few select countries - the UK, New Zealand, Australia and Canada. The bill had overwhelming support in the state legislature and the Republican governor quietly allowed the legislation to become law.

But many state employees, as well as workers at the city of Portland and one large company, claimed they had saved some $10 million through Internet purchases over several years. For this reason, the bill had some backing from the business community and dissuaded the Republican governor from issuing a veto. Similarly, state and local governments may also save money. The state employee's union estimates savings of $6 to $10 million, according to Troy Jackson, the state senator who introduced the bill.

"In my area of the state, 15 years ago, people were organizing bus trips to go to Canada to get drugs for a cheaper price. For whatever reason, drug companies are selling same drugs through other countries for less than they do here and the issue is too important for people to pay more for life-saving medicines," Jackson says. "I'm a big proponent of 'Buy America,' but we're talking about people's health. If drugs are 40 percent higher in the US, well, I just can't stomach that. This is one way to rectify the problem."

Not surprisingly, the trade group for the pharmaceutical industry is incensed. At the time the bill was first introduced and debated, the Pharmaceutical Research & Manufacturers of America argued that passage would jeopardize patient safety for various reasons, including the possibility of counterfeit meds entering the supply chain, and that savings would actually be minimal. And after Maine Governor Paul Le Page let it become law two days ago, PhRMA had this to say:

“Considering PhRMA’s strong stance against counterfeit medicines and related importation concerns, we were very disappointed to hear that Governor Paul LePage has failed Maine’s patients, by allowing (the bill) to become law. Opening our borders to unapproved, imported drugs could increase the flow of counterfeit drugs into the US, putting patients at senseless risk and with little recourse against their injuries. We hope to continue our work advocating for safe medicines for patients in Maine and look forward to ongoing work with Maine legislature and the Governor on this issue.”

Indeed, regulators and drugmakers have been railing against counterfeit medicines for years and regularly point to the proliferation of online pharmacies as a key culprit. Counterfeit medicines generated some $75 billion in revenue in 2010, according to the National Association of Boards of Pharmacies. Pfizer, for instance, cited counterfeit Viagra as a key reason for starting its own online sales earlier this year (back story). The drugmaker also has an aggressive campaign against fake meds.

Meanwhile, as many as 100,000 people around the world may die from "falsified" and substandard medicines each year, according to Amir Attaran of the University of Ottawa and Roger Bate of the American Enterprise Institute (see this).

And the move in Maine comes as the FDA steps up enforcement activities against online pharmacies. Last fall, for instance, the agency and law enforcement authorities took various actions against more than 4,100 Internet pharmacies, including filing civil and criminal charges, seizing products and closing down web sites.

In fact, on the same day that the bill became law in Maine, the FDA and law enforcement again moved against Internet pharmacies by issuing warnings and seizing $41 million worth of medicines from approximately 9,600 websites that were accused of selling medicines illegally. And many of these websites appeared to be operating as a part of an organized criminal network that falsely purported its websites to be “Canadian Pharmacies,” according to the FDA (more here).

Such episodes also prompted the Partnership For Safe Medicines, a non-profit aligned with drugmakers and pharmacists, to rail against the Maine bill. “However well-intentioned Maine’s importation legislation may be, the health risks of counterfeit medicines far outweigh any cost savings. The bottom line is that the FDA cannot guarantee the safety or efficacy of any prescription medication from outside the US supply chain, and when medicines are not FDA approved patients are put in danger,” PFSM head Marv Sheperd says.

But others who supported the legislation argue that the safety arguments are often a red herring and that fake drugs are not the same as drugs that are approved for sale in the U.S. but are labeled and packaged for markets in Canada, Australia, New Zealand, and the UK.

“Americans have accessed medication internationally for over the past decade but federal prohibitions on personal drug importation, while not enforced against individuals, have deterred millions. With that regulatory weight lifted in Maine and with proper guidance more Americans will have access to safe and affordable medication,” says Gabriel Levitt of PharmacyChecker.com, a consumer website which evaluates the credentials of online pharmacies and provides drug price comparisons.

And one Maine legislator says the new law will provide an economic benefit, even if it pinches the bottom line for some drugmakers. "This legislation will save money for Maine consumers, businesses, and local and state governments and provide access to high quality medications. Prescription drug prices in the US are the highest in the developed world. Instead of negotiating prices, the federal government is supporting measures to keep costs high through trade agreements that lock in high prices and long-term patents that delay less expensive generics,” says Sharon Anglin Treat, a Maine legislator who also heads the National Legislative Association on Prescription Drug Prices. “Until such time that we join other countries in making drugs affordable, importation in the manner enacted by the Maine Legislature makes eminent sense.”